Dollar higher on Fed taper news

  • July 15, 2021

Dollar higher on Fed taper news

The dollar reversed earlier losses and is higher on the day. The dollar started the today on the soft side following yesterday’s dovish comments by Fed Chair Powell. This morning’s news that China’s economic growth data met expectations fueled gains in the CNY/dollar weakness. The dollar rallied after hawkish comments this morning by St. Louis Fed President James Bullard, who argued to taper bond purchases/reduce stimulus on inflation concerns. The dollar is broadly higher, the index up by 0.25%. US and European stocks are lower. US Treasury 10Yr yields fell by 3 bps to 1.32%. Gold and oil prices fell slightly $1843 and $72.00, respectively. Traders await Fed’s Powell second day of Congressional testimony.

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  • FX Rates
    July 15, 2021

    Rates are not real time. Rates are today's indicative mid-market rates as of time of publishing, which may vary. Please contact SVB for a current quote.

  • USD

    The dollar is higher on the day, fueled primarily by Fed’s Bullard hawkish comments. In an interview with Bloomberg, he said the Fed has reached both its inflation and employment goals, suggesting that the Fed should move forward with tapering its bond purchases. Bullard is not currently a voting member of the FOMC. Fed Chair Powell is the key voting member, and he remains dovish, committed to continue stimulus until further progress is seen with economic recovery and employment.


    The UK pound moved little overnight, but outperformed nearly all its peers in today’s strong dollar environment. Higher-than-expected inflation and strong employment data fueled demand for the currency.


    The euro fell slightly in line with the broadly stronger US dollar. ECB central bank governor Ignazio Visco said that tapering would be avoided, and “monetary policy not be tightened for a long period.” There were no economic data releases for the eurozone today.


    The CAD is weaker by nearly 0.30% overnight, reversing a four-day rally in the currency following the Bank of Canada’s announcement that it would continue to taper bond purchases despite forecasts of higher inflation. Existing Home Sales for June were lower by 8.4%, worse than May’s -7.4%.


    The Chinese yuan reversed earlier losses on news that China’s economic growth met expectations. GDP for Q2 grew by 7.9% YoY, down from 18.3% in Q1.

    The USDJPY trades under 110 and is nearing its lowest levels in a month.

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